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David Hubbard and Kris Beck founded WACS, now Ecologic Analytics, in 2000, and now have 50 employees.

Katharine Grayson

Staff Writer

Power companies will spend billions to upgrade aging electricity networks with so-called “smart-grid” technologies in the coming years. Several Minnesota businesses, from regional divisions of major corporations to homegrown firms, are poised to benefit from the wave of investment.

Smart-grid technologies, which range from sensors to software to high-tech meters, help utilities better monitor their networks and run them more efficiently. Examples include “smart meters,” which remotely transmit a consumer’s power-usage data to a utility, and devices that help spot and quickly correct transmission problems.

Many Twin Cities firms have made such products for years, though company officials say the market recently has heated up. That’s partly due to the federal stimulus package, which includes about $4.5 billion for smart-grid projects. Stimulus funds for such projects are expected to be awarded next month. Officials also say the market has been helped by the movement to develop industry standards that ensure smart-grid devices work properly with one another.

Overall, power companies and governments worldwide spent $12 billion on smart-grid projects in 2008. By 2014, they likely will have invested a total of $33 billion, according to NextGen Research, a division of Boston-based AMR Research.

In Minnesota, several firms are targeting demand for smart meters and related software. Bloomington-based Ecologic Analytics makes software that utilities use to manage and analyze data culled from smart meters. It recently released a product that allows power companies to detect outages through smart meters.

Kris Beck and David Hubbard, both former Xcel Energy Inc. employees, founded Ecologic Analytics — then called WACS — in 2000 and now have about 50 employees. Over the past nine years, use of the term “smart grid” and interest in smart-meter technology have blossomed, said Hubbard, who serves as the firm’s chief technology officer.

“What we’ve seen now is that the technologies have matured. They’ve become technically and financially feasible,” he said.

When the stimulus plan was announced, many power companies held off or reshaped projects in an effort to receive stimulus dollars, said John Galloway, a sales manager for Ecologic Analytics. Once the government issues awards, however, smart-grid work is likely to pick up. The technology’s ability to help utilities communicate with customers, who can use data to save money by using energy during off-peak hours, will likely prompt “explosive” growth in smart-grid, he said.

Other players in the smart-meter business with Minnesota ties include Landys+Gyr, a smart-meter company based in Zug, Switzerland, which has a research-and-development center in Pequot Lakes. Landys’ presence in Minnesota stems back to its acquisition of Hunt Technologies Inc., a firm that had about 170 employees when it was sold in 2006. Landys, which has more than 5,000 employees worldwide and revenue of about $1.36 billion, is an investor in Ecologic Analytics.

Cooper Power Systems, a Waukesha, Wis.-based subsidiary of Houston-based Cooper Industries Inc., also has a smart-grid operation in Minnesota. The 120-person office in Golden Valley focuses on technologies that help utilities collect data from smart meters and respond to changes in power demand.

Cooper entered Minnesota in 2006 when it bought Cannon Technologies Inc., a firm founded in the Twin Cities. Revenue from Coopers automated energy-services business, which includes the Twin Cities offices, is roughly $200 million.

The division has continued to do well, despite the recession, said Jim Roche, a senior market manager for Cooper’s Automated Meter Infrastructure (AMI) business in Minnesota. Overall, the Twin Cities is a strong hub for smart-grid companies as many firms, including Cooper, gained experience in the arena by working with small power cooperatives that adopted technology before large utilities.

Other smart-grid players in Minnesota include Open Systems International Inc., a software firm based in Shakopee, and Open Access Technology International Inc. (OATI). OATI, based in Plymouth, makes software for utilities implementing smart-grid technology. It has about 500 employees and recently announced plans to expanded into a building it purchased in Minneapolis.

Digi International Inc., Minnetonka, recently entered the market, launching products that would help utilities monitor energy use in a customer’s home and automatically adjust the temperature during peak times.

Overall, the Twin Cities are positioned well in the smart-grid arena, said Ecologic Analytics’ Hubbard. “Minnesota is a great place to have a smart-grid company.”

Some of Minnesota’s smart-grid players:

Cooper Power SystemsLocal office: Golden ValleyBusiness: Technology that helps power companies respond to changes in demand and other tasks

Landys+GyrLocal office: Pequot LakesBusiness: Smart-meter researchDigi International Inc.City: MinnetonkaBusiness: Technology that helps utilities monitor energy use in a customer’s home and automatically adjust the temperature during peak times

Open Access Technology International Inc.City: PlymouthBusiness: Software used to track energy transmission, scheduling and other grid-related tasks

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